Silver followed suit and plunged by Rs 1,000 to Rs 62,000 per kg on reduced offtake by industrial units and coin makers.

Traders said stockist selling in tandem with a weak global trend where gold and silver fell the most in more than three weeks amid concern that budget talks to avoid the US fiscal cliff are making little progress, mainly influenced the sentiment.

Gold in global markets, which normally set price trend on the domestic front, fell by 1.7 per cent to USD 1,714.90 an ounce, biggest drop since November 2 and silver by 1.8 per cent to USD 33.47 an ounce, biggest decline since November 2 in New York.

In addition, fall in domestic demand at prevailing higher levels and investors shifting from weakening bullion to rising equity further dampened the sentiment, they said.

On the domestic front, gold of 99.9 and 99.5 per cent purity slipped by Rs 35 each to Rs 32,940 and Rs 32,740 per 10 grams, respectively. The metal had climbed to an all-time high level of Rs 32,975 in the previous session.